SPAIN: PM To Address Media @ 17:15CET After PSOE Secretary Resigns In Scandal

While April was widely considered to be too early to see significant impacts from tariff-induced pickups in inflation, the evidence looking through the report is mixed.

• The biggest hint of a tariff-induced pickup is that core goods ex-used cars CPI posted the strongest unrounded rate of inflation (0.15% M/M) since March 2023.  
• Category-by-category though, it was less clear.
• Household furnishings and supplies rose 0.2% M/M (just a 2-month high), though within that, furniture/bedding was up 1.5% M/M (a 7-month high), and appliance prices 0.8% (most since March 2022).
• By comparison, we didn't see any evidence in another closely-watched import category: apparel (-0.2% after 0.4%). and other categories such as toys and computers - while in some cases stronger than in March/February - didn't show anything out of the ordinary compared with previous months' readings.
• Motor vehicle parts and equipment - a key focus of tariffs and concerns surrounding supply chains - fell by 0.1%.
• A mention here too for video and audio products which rose 1.0% M/M (most since Oct 2024), with audio equipment soaring 8.8% (the most since at least 2009) but television/other equipment prices declined so this isn't particularly clear evidence of a tariff impact.

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The nonpartisan Joint Committee on Taxation has issued a positive assessment of the revenue implications of the House Republican tax bill. The House Ways and Means Committee is scheduled to mark up the bill today as part of President Donald Trump's 'One Big Beautiful' Bill to legislate his domestic agenda.   

• The JCT scores that the Ways and Means tax bill adds $3.7 trillion to the deficit over 10 years. That is well within the $4 trillion allocated to Ways and Means by the budget resolution adopted by Congress last month.
• The lower score will give House Speaker Mike Johnson (R-LA) and Ways and Means Chair Jason Smith (R-MO) slightly more breathing room as they go into the crucial markup today. One area where the additional headroom could be used is to bump up the SALT cap for blue state Republicans.
• The Ways and Means bill offers a $30,000 cap to people earning less than $400,000. The so-called SALT Republicans rejected that same offer last week, threatening to torpedo the entire package if Johnson didn't revise his offer.